Microsoft Word - ACC311 Essay 1 - Sem1 2019 ACC311 Accounting Theory and Current Issues Semester 1, 2019 Assessment 1: Essay 1 This assessment is worth 25% of your final grade and is to be in essay...

Running Head: ACCOUNTING THEORY AND CURRENT ISSUES            1
ACCOUNTING THEORY AND CURRENT ISSUES                    10
ACC311 ACCOUNTING THEORY AND CURRENT ISSUES
Table of Contents
Introduction    3
Various Conceptual Frameworks (CF) and their Impact on Accounting Practices    3
Australian Accounting Standards Board (AASB)    3
Financial Accounting Standards Board (FASB)    3
International Accounting Standards Board (IASB)    4
Positive Accounting Theory    4
Normative Accounting Theory    5
Bush Fire Theory    5
Issues related to Qantas Airlines regarding Accounting Conceptual Framework    5
How Normative and Positive Accounting Theories either Inform or Correspond to the CF    6
Positive Accounting    6
Normative Accounting    7
Analysing Issues related to Qantas Airlines applying Accounting Theories    7
Conclusion    8
References    9
Introduction
The Conceptual Framework is a type of analytical tool that is applied in different categories of work to maintain uniformity for easy comparison and interpretation of the results. The Accounting Conceptual Framework is a theory with details about the basic reasoning underlying the financial statements and financial reporting in general. International Accounting Standards Board (IASB) develops it, which is the independent and accounting standard-setting body of the International Financial Reporting Standards (IFRS) Foundation. It was established in the year 2001 as a successor of International Accounting Standards Committee (IASC).
Various Conceptual Frameworks (CF) and their Impact on Accounting Practices
Australian Accounting Standards Board (AASB)
    The purpose of the framework is to –
1. Develop future AAS, review the existing standards and include changes proposed by IASB.
2. According to the views of Howieson (2017), synchronisation and management of accounting provisions, regulations and procedures related to presentation of financial statements by fixing the no. of accounting treatments permitted by AAS.
3. Assist people, auditors and users for preparing, forming an opinion and interpreting financial statements according to AAS and to deal with topics yet to form the subject of an AAS.
Just like the AAS, the framework is also modified at regular intervals depending on the experience of working of the regulatory body. .
Financial Accounting Standards Board (FASB)
    As stated by Palmrose and Kinney (2018), the FASB’s conceptual framework help the board in setting sound financial accounting standards and help the board members to understand and apply those standards as well as significantly contribute to their development. The board intends to solve the reporting issues and find solutions to complex problem of accounting. The same is done by use of precise technology as a basis for discussion and helping to ask the right questions.
The FASB’s framework was around three decades back. Since then, the financial activities and the complexity of the business along with the involved transactions has increased rapidly. After comprehensive review of the framework, board has decided to work on a Conceptual Framework Project to increase the impact of disclosures in the financial statements by mentioning the information, which is critical for the users of the financial statement of the organisation. .
International Accounting Standards Board (IASB)
    This board does not belong to any country but has its own sort of constitution, in the form of the Conceptual Framework for Financial Reporting (the Framework), which acts as a supporting document for the modification and setting up of the accounting standards. It can be described as a theory, which is a statement of principles. According to Camfferman and Zeff (2015), the conceptual framework ensures that the accounting standards help in solving the issues on a regular basis. It assists the IASB to develop coherent and consistent accounting standards and acts as a guide for people preparing financial statements to resolve accounting problems not addressed directly in accounting standards (Potter 2005). It is one of the most critical and influential document for users of the financial statements to get...